A proposal to provide a minimum pension amounting to Rs 1,000 per month to the 1.5 million workers covered by the Employees’ Pension Fund Organisation (EPFO) is hanging fire because there is no agreement on who should fund this scheme.

Sources say the EPFO is discussing Rs 1,000 as a minimum pension for all its members. Even so, while a consensus has been reached on this between the employers and the employees’ representatives, the sticking point remains: who will pay for it?

Estimates say it will require 0.63 per cent increase in the contribution to pay a minimum pension of Rs 1,000. So far, the employers’ representatives, the employees’ representatives and the labour ministry have been unable to decide on who would bear the burden.

On Thursday, a meeting was held, but it yielded no consensus. If the deadlock continues, the matter would be referred to the Central Board of the Trustees’ of the EPFO.

The increase in contribution would be in addition to the 8.33 per cent which the employers already contribute and 1.16 per cent that comes from the central government. A government decision to bear the cost will necessitate an amendment to the Employees’ Pension Scheme (EPS) through Parliament’s approval.

Earlier, the representatives of the employees had also demanded a provision for three per cent annual increase in pension in addition to fixing Rs 1,000 as the minimum pay. The demand was rejected on the grounds that a three per cent annual increase would require a further additional contribution of 4.45 per cent.

It had, after studying the recommendations submitted by the expert committee set up by the central government to look into the EPS, 1995, concluded three things. One, a raise in wage ceiling from Rs 6,500 to Rs 10,000; two, a provision of annual relief of three per cent, and three, a minimum pension of Rs 1,000 to all categories of pensioners.